Why do marketing plans fail? That is what we are here to talk about today. I’m Alex.
We’re with Sage Digital agency, a digital marketing firm in Las Vegas and Miami.
What’s going on Alex?
Life is good, Mike. What’s going on with you?
Life is good. Can’t complain. No one’s going to listen anyways.
That’s true. Laugh and the world laughs with you. Cry and you cry alone.
I’m coming to see you in two days. Isn’t something happening this weekend, Mike?
Wedding weekend coming up. Very excited.
Yes, yes. I’ll be traveling to Miami. I’m going to spend some time with my friend Mike, and go to Key West as well.
80 and sunny, and the rest of the country is covered in snow. Florida is a good place to live.
Marketing plans are usually one and done things. It should be a guide. They should be constantly reviewed and modified, and they should have clearly defined and obtainable milestones.
Mike, talking about why marketing plans fail. First and foremost, correct me if I’m wrong. A lot of businesses, it seems to me, create a “marketing plan” on their own, or with friends, or someone else in order to achieve some objective, maybe it’s financing, maybe it’s getting something else done. I’m not so sure it’s always done by a professional and with all the up-to-date technologies possibly available, and opportunities available to them. Would you agree?
Yeah, I agree. I think if you have someone right out of school with no experience, or you have someone who’s just putting together a marketing plan without any experience behind it, or knowledge of how to obtain the goals that the marketing plan is set to yield, I definitely don’t think that’s a solid plan.
Agree, totally. How can somebody without experience or without industry experience be the one creating a marketing plan for a business.
I think the first place to start with is the plan itself. Think of school, when you write a paper for a class it was set. You do the research, you put down the facts, you make it nice and pretty, you hand it in. That’s where it ends. However, after years and years of doing that I think so many people, so many businesses are in that mindset of this is how you create a marketing plan. You just put down what you think you want to do, they guess their advertising expenses, they guess what their cost of customer acquisition is, and then that’s the Holy Grail for a lot of these businesses.
Meanwhile, they’re never modified, the goals don’t change, the cost of acquisition doesn’t change, channels don’t change. If you would have had a marketing plan three years ago, recent, Instagram was already huge, Facebook, Google ads, and maybe you were selling something. The ability to sell through Instagram was not a feature that was available three years ago.
These marketing plans need to be kept up-to-date to stick with what’s actually working now. Just because something is working at the time of creating your marketing plan doesn’t necessarily mean it’s the right fit for the business. Maybe you find a specific channel that’s now profitable. Nothing wrong with that, but your plan needs to change. I think that’s where I see a lot of customers really struggle in trying to evaluate certain channels of risk. Do they want to go into Google ads? Do they want to try social media advertising? Do they want to try specific bidding strategies. I find that a lot of businesses just really aren’t sure because they’re not confident in their marketing plan.
I’m also thinking to myself are we talking about newer businesses just getting off the ground? If so, how could they possibly know their cost of acquisition without a significant amount of historical data to look upon reporting and gage it from there, right?
I don’t think they can, and I don’t think there’s anything wrong with that. Obviously they’re in business because they’re knowledgeable about the industry, or what they do, or the service they provide. That’s great. That’s a good start because at least they know how to deliver the product. At the end of the day you have the best marketing. If your product is bad, it’s not going to cover up for the marketing.
So, assuming that say an electrician is competent, he knows exactly what to do, provides good service, can answer the phone, can explain the problems to the customer without any issues. Great, now he’s got a business. As far as how much does it cost to acquire a customer, there’s not a magic number of here’s what it costs. No one can tell you, “This is what it’s going to cost to get a customer on Google ads.” I can tell you that a click is three dollars, five dollars, twenty dollars, whatever it is, but how many clicks will it take until you can get a customer to call you?
We’re never going to know until we actually run a campaign.
Correct. Now, certainly for most businesses that are risk-adverse and do not want to spend a whole bunch of money just to spend money, there are several safeties, if you will, that can be put into place, and levers that can be pulled to ensure that their campaign is set up for success. Now, if you keep an eye on the campaign, and you closely monitor it, you’re going to catch where certain keywords might not be working. If you pay attention and you know what you’re doing, you’ll make sure you’re not wasting your spend.
Do you think most businesses are going into a new marketing venture, a new plan for their business saying, “Hey, I want to invest heavily in digital marketing,” or is it, “I want to spend some money on social media, and maybe we’ll do some other form, magazine ads. Maybe we’ll spend some time on the radio. Maybe we’ll do X, Y, and Z outside of digital marketing”? You and I live and breathe digital marketing. That’s our entire business, so it’s the curse of knowledge. We’ve got it, we know it, we know what works in most cases, but I’m not sure if a subject matter expert on whatever their business is going into it saying, “I want to spend all this money on Google because I believe in it, because I know all the factors about it.” Am I making sense here?
Yeah, I think it really just depends on the business itself and the industry. I think that you have a lot of, what I call, shiny object syndrome where a new marketing channel comes out and businesses want to get on there. There’s nothing wrong with dipping your foot in the water to test the grounds, and see what works, and see what doesn’t work.
However, say a doctor for instance, acquiring a customer through Instagram is likely not the best strategy compared to Google ads. But, some businesses hear Instagram, they see other businesses on Instagram and they think this is what I want to do, so they go in head first into a channel without any real understanding of how it works, or the user intent, or exactly how to get a customer, or what they can afford to acquire the customer. You can have the same business that advertises on both Google and Instagram, and the actual cost of customer acquisition is going to be significantly different.
Sometimes I’m hearing from our conversation too is hey, this marketing plan, it has to be a living document so to speak. It’s not something that we can just etch in concrete when we plan for it and we do in the beginning, and never look at it again. Things change, like you said, so how could we have possibly projected correctly at that point years ago and not changed it according to the technological updates that we’ve seen and the changes in the industries that we’ve seen, correct?
Yeah, you really couldn’t. These plans need to be really bonafide training programs, if you will. They need to have obtainable milestones and clearly defined goals. At that point you can really evaluate how is your marketing plan actually working. Even if you don’t have a full understanding of the channels or what works, you still have a clear, defined understanding of your business and what works for your business. Then, you can find the marketing channels that will fit within that. If you charge $100 for whatever you sell, no matter how you figure out the numbers, you’re working with $100.
You need to understand that the time, the cost of goods, the cost of customer acquisition, all that falls into what you sell. Knowing your numbers is certainly the key, but having a clear understanding of how your ad campaigns, where your marketing campaigns are performing, that’s what’s going to be what really allows business either be profitable or sink. There’s not a master checklist that works for all businesses.
I think it’s really a matter of sitting down. It doesn’t have to be anything super formal. I think that businesses before they get started in marketing, advertising, digital, they really need to have a clear understanding of what their goals are and really what they want out of that. That can start before they even have a website. If they want a website, and you know websites better than anyone, what’s the goal of the website? What are they doing with it? What do they want? How many pages?
Sure, I ask that question every single time. What is its purpose? If we’re going to spend time, effort, money, resources to build something, what are we going to do with this thing after the fact?
From a marketing standpoint, so much of the work is put in at the initial phase that we need to make sure from our side that the customer has an understanding of what will work for their business. If we spend three months running ad campaigns and then all of a sudden they figure out, “Oh, well I don’t know my numbers and I don’t want to continue advertising.” That’s not a good situation for either one of us. They’ve spent money and obviously time. We’ve spent time, effort to optimize their campaigns. We set up the conversion tracking, and the analytics, starting sifting through the optimizations, but the optimizations never actually see fruition.
Understanding the numbers and understanding your goals really is the key to ensuring that your marketing campaign is successful. I think they key takeaway here is to really have a clear understanding from a business decision. That’s really what it is. It’s a decision for your business when it comes to your marketing on what you want out of it. Obviously everyone has their goals of, “This is how much I need to make to pay payroll,” or, “This is how much I need to be able to pay rent.” Your marketing plan really should be that same thing. Here’s what I need out of my marketing plan. That way you’re able to gauge if it’s successful or if it’s not.
Mike, we’ve talked about a lot of subjects here with respect to a marketing plan, where things go wrong, where things are etched in concrete, as I said, not updated. We talked about a lot. I think at the end of the day there’s a world of opportunity available to businesses in digital marketing, whether it’s on Google ads, in Facebook, or otherwise.
Sure, I think a lot of people, especially people who have been in business for a long time, it’s a little bit of a learning curve because an older generation certainly comes from magazines and print, and TV and radio where you didn’t have these options, you didn’t have the ability to track conversions, and understand exactly how your metrics were performing.
Mike, it’s quite scary frankly. The degree of hey, I visited a website, I interacted with that website in a particular way. Due to that interaction, I am seeing very targeted ads in my news feed on Facebook. I’m seeing display ads in various parts of the internet. It’s an incredible tool.
Yeah, some people are afraid of it, some people don’t like it. I’m very pro targeting. I think that now with the ability to track and market exactly to the customers that you want, and not spend any money for time marketing the customers that aren’t going to buy from you anyways. You have the resources at your fingertips. Businesses really just need to have an idea, even if it’s not exact, of who they want to reach. At that point we can reverse engineer and find this is how much it costs, this is how much we can afford, is this specific strategy, this channel profitable?
Again, you’ve really hit the nail on the head, we’re targeting a very specific person with an intent. We are not just blasting out random emails to people. We’re not blasting out ads to the entire population that we’re praying a small segment of them will be interested in the service or the product.
Well, Mike, it’s been another great podcast. I always love our conversations. To our listeners, if you have any questions or comments please email us at firstname.lastname@example.org. We’d love to hear from you. We’ll make sure we’ll get your questions answered in a future upcoming podcast.
This is Michael.
This is Alex. Thanks very much for listening.